Jumia(US:JMIA)2022-04-28 16:00Market Risks - The company is exposed to various market risks, including foreign currency risk, and regularly assesses these risks to minimize adverse effects on its business [668]. Supervisory Board Structure and Responsibilities - The supervisory board currently consists of eight members, with no requirement for a majority to be independent under German law [680]. - The supervisory board has set a target of at least 37.5% female members by December 31, 2023 [685]. - The company requires supervisory board approval for significant financial decisions, including loans exceeding €5.0 million and investments in fixed assets over €4.0 million [688]. - Members of the supervisory board may be dismissed by a simple majority vote from the shareholders' meeting [684]. - The supervisory board meets at least four times a year to supervise the management board and review business operations [687]. - The supervisory board has the authority to approve changes in business operations that significantly impact the company, including acquisitions exceeding €1.0 million [688]. - The supervisory board determines the number of members in the management board and can appoint chairpersons and deputy chairpersons [703]. - The supervisory board may remove a management board member for cause, including serious breaches of duty [704]. - The company has established rules for the election and term limits of supervisory board members, with a maximum term of approximately five years [682]. Management Board Structure and Responsibilities - The management board is responsible for day-to-day operations and must report regularly to the supervisory board on business planning [675]. - The management board consists of two members, Jeremy Hodara and Sacha Poignonnec, both serving as co-chief executive officers since the company's founding in 2012 [712][713]. - Antoine Maillet-Mezeray has served as the chief financial officer since 2016, overseeing significant operating scale and complexity in finance teams [715]. - The management board is responsible for preparing annual financial statements and reporting on current operating and financial performance [710]. - The management board's term for both Hodara and Poignonnec will expire on December 31, 2022, under current service agreements [712]. Compensation and Incentives - The supervisory board members receive fixed compensation of €100,000 per annum, with the chairperson receiving €225,000 and the deputy chairperson €115,000 [718]. - The chairperson of the audit committee receives an additional fixed compensation of €100,000 per annum, increased by €64,250 for the financial year ending December 31, 2021 [718]. - The company has established a compensation system for supervisory board members that was resolved in the annual general meeting held on June 9, 2021 [718]. - The total target compensation for Jeremy Hodara in 2021 was $4,875,000, which includes a base salary of $477,000 and a short-term incentive of $1,948,000 [730]. - Sacha Poignonnec's total target compensation for 2021 was $4,869,000, with a base salary of $474,000 and a short-term incentive of $1,948,000 [730]. - The management board's variable compensation in 2021 accounted for 90% of their total compensation, reflecting a strong performance incentive structure [730]. - The supervisory board members received a total compensation of $372,000 in 2021, with Jonathan D. Klein earning $266,000 and John H. Rittenhouse earning $136,000 [721]. - The management board compensation system is designed to promote long-term growth, focusing on sales volume and increasing the number of sellers on the platform [726]. - A one-time bonus of €5.0 million was awarded to members of the management board and senior management in early 2019 [728]. - The company has agreements with management that include both fixed and performance-based compensation components, with specific insurance benefits included [728]. Stock Options and Performance Targets - Management board members received a total of 2,169,552 stock options under the JSOP 2016, with a target amount of $26,765 thousand and an exercise price of €1.00 [741]. - Under the SOP 2019, each management board member was granted 134,644 stock options, with a performance target of a 10% compound annual growth rate of GMV over a four-year period [737]. - The SOP 2020 granted 500,000 stock options to each member, also with a 10% compound annual growth rate target for GMV over four years [738]. - The SOP 2021 awarded 411,729 stock options to each member, with a higher performance target of a 15% compound annual growth rate of GMV over the four-year performance period [739]. - As of April 2020, Jeremy Hodara and Sacha Poignonnec achieved 100% of the performance target for the JSOP 2016, resulting in the exercise of 1,147,278 options each [744]. - The Virtual Restricted Stock Unit Plan 2020 granted 500,000 units to each management board member, which vested in full in May 2021 without performance conditions [746]. - For the Virtual Restricted Stock Unit Plan 2021, 131,922 units were granted to each member, but 50% did not vest due to not meeting the 15% GMV growth target for 2021 [747]. - As of December 31, 2021, the value of shares held by each management board member exceeded the shareholding requirement by more than 20 times [757]. - No malus or clawback provisions were applied in fiscal year 2021 [755]. - The performance target for the SOP 2019 and SOP 2020 will be determined after the end of their respective performance periods, starting in May 2023 and May 2024 [745]. Employee Statistics - As of December 31, 2021, the company employed a total of 4,484 full-time equivalent (FTE) employees, with 35% being female and 65% male [785]. - The average remuneration per employee increased from €20.3 thousand ($23.2 thousand) in 2020 to €21.0 thousand ($24.8 thousand) in 2021 [788]. - The employee breakdown by geography shows that West Africa had 1,828 employees, North Africa had 1,520, and East and South Africa had 702 as of December 31, 2021 [786]. - Approximately 49% of the workforce consisted of marketplace operations and management employees, while logistics employees accounted for 40% [785]. Governance and Compliance - The company’s audit committee includes John H. Rittenhouse as the audit committee financial expert, ensuring oversight of financial statements and compliance [775]. - The compensation committee is responsible for preparing recommendations regarding management board compensation and employment terms [777]. - The company issued its most recent annual compliance declaration regarding the German Corporate Governance Code on December 22, 2021 [783]. Shareholder Information - Baillie Gifford & Co. holds 19,845,212 shares, representing 9.9% of the total shares outstanding [795]. - Pernod Ricard Deutschland GmbH owns 12,851,169 shares, accounting for 6.4% of the total shares [795]. - As of March 1, 2022, there were 92,003,075 ADRs outstanding, representing 92.1% of the then-outstanding ordinary shares [796]. - The total shares beneficially owned by all members of the supervisory board, management board, and senior management is 3,880,754, which is 1.9% of the total shares [795]. - The company cannot determine the identity of its shareholders due to the bearer form of its ordinary shares [796]. - The company is not aware of any arrangements that may result in a change of control [796]. Related Party Transactions - The group has engaged in related party transactions since January 1, 2019, with members of the supervisory or management board [798].